Real Property · Future Interests

medium frequency

MBE Real Property: Future Interests

Explore the complexities of future interests in real property law, including various types and their implications.

Overview

Future interests are legal rights to property that may become possessory in the future, encompassing various forms such as executory interests, remainder interests, and reversions. Understanding the distinctions and rules governing future interests is essential for navigating real property law, as they can significantly affect property rights and interests during and after the life of the current holder. Knowledge of the rules associated with these interests is critical for success on the Multistate Bar Examination, as they frequently appear in hypothetical scenarios.

The determination of whether a future interest is valid often hinges on the present and future interests in the property and their characteristics, such as whether they are vested or contingent. A keen grasp of the Rule Against Perpetuities, as well as the specifics of how interests can be transferred or extinguished, is vital. On the MBE, candidates should anticipate being tested on scenarios that require them to identify the applicable future interests, analyze their validity, and predict potential outcomes in various property transfer situations.

Key Rules
  1. A future interest can be created in a valid manner if it follows the legal requirements.
  2. There are four main types of future interests: reversion, remainder, executory interest, and possibility of reverter.
  3. A vested remainder is one that is guaranteed to become possessory in the future, while a contingent remainder is dependent on a condition.
  4. The Rule Against Perpetuities states that certain future interests are not valid unless they must vest, if at all, within a life in being plus 21 years.
  5. A life estate is often followed by a remainder or reversion that dictates what happens to the property upon the death of the life tenant.
Common Question Patterns
  • Determining whether a given future interest is valid or void under the Rule Against Perpetuities.
  • Identifying the type of future interest that follows a life estate.
  • Assessing the effects of a conveyance that includes future interests on current and future property holders.
  • Evaluating the sequence of interests when multiple future interests are involved.
  • Resolving conflicts between vested and contingent remainders.
Practice Questions

1. A conveys land 'to B for life, then to C if C graduates from college, otherwise to D.' What kind of future interest does C have?

A. A) Vested remainder

B. B) Contingent remainder(Correct)

C. C) Executory interest

D. D) Reversion

Explanation: C has a contingent remainder because their interest is subject to the condition of graduating from college.

2. O grants Blackacre 'to A for life, then to A's children.' A has no children at the time of the grant. What type of interest do A's potential children have?

A. A) Vested remainder

B. B) Contingent remainder(Correct)

C. C) Executory interest

D. D) Nothing

Explanation: A's potential children have a contingent remainder because it depends on whether A has children before A's death.

3. O conveys property 'to A for life, then to B if B has reached the age of 21.' If A dies and B is 19, who owns the property?

A. A) A's estate(Correct)

B. B) B

C. C) O

D. D) Rights revert back to A

Explanation: The property goes to A’s estate because B's interest is contingent on reaching the age of 21 and has not vested yet.

4. O conveys land 'to A for life, then to B if B marries by the age of 30.' B is currently 25 and unmarried. What type of future interest does B hold?

A. A) Vested remainder

B. B) Contingent remainder(Correct)

C. C) Executory interest

D. D) Life estate

Explanation: B has a contingent remainder dependent on the condition of marrying by 30, which has not yet been satisfied.

5. A conveys land 'to B for B's life, then to C.' B is a minor. Which of the following is true?

A. A) C's interest is a vested remainder.(Correct)

B. B) C's interest is a contingent remainder.

C. C) C has no interest as B is a minor.

D. D) O can reclaim the property immediately.

Explanation: C's interest is a vested remainder because it is not conditional on any future event; it simply awaits the death of B.

Test-Taking Tips
  • Familiarize yourself with the definitions and characteristics of each type of future interest.
  • Pay particular attention to conditional language in the conveyance, which can indicate vested or contingent interests.
  • Practice applying the Rule Against Perpetuities through hypothetical scenarios to strengthen your understanding.
  • Review past MBE questions on future interests to identify common traps and question formats.
  • Consider potential outcomes systematically, especially in complex fact patterns with multiple future interests.

Master MBE Topics with Briefly

Get AI-powered study tools, practice questions, and comprehensive legal resources.